Stocks

Capital loss

A loss that results when an asset is sold for less than its adjusted cost basis.

Plain-English context

Put the definition to work.

ILLUSTRATIVE EXAMPLE

Selling for $800 with $1,000 adjusted basis produces a $200 loss; tax deductibility can differ because of wash sales and other rules.

IMPORTANT DISTINCTION

An economic loss is not automatically currently deductible; wash-sale and other loss limitations can change recognition.

Further reading and verification. Examples are hypothetical, not current quotes or recommendations. Product terms, tax treatment and market rules can change. Investor.gov — investing glossary

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